Costs when selling a property

As with the sale of a property, there are also costs that have to be deducted from the sale price. It is important to know these costs in advance and to take them into account when setting the sales price. A rough rule of thumb is that around 5% to 10% of the sales price should be budgeted for ancillary sales costs.

1. Capital gains tax/Plusvalia: Capital gains tax is a tax that is payable on transactions involving second-hand properties. The increase in value that the land (not the property) has experienced since the property last changed hands is taxed. There are 2 calculation models for this:
   1. Cadastral value on sale, with an annual coefficient and max. 30% (the current cadastral value can be viewed online – ask us)
   2. Difference between the current sales price and the purchase price at the time, of which 60% as a share for the property and here also max. 30%

   The maximum value of 30% varies from municipality to municipality. The seller can choose the better model for himself. Plusvalia’s tax liability must be paid to the tax office within 30 days by way of self-assessment.

2. IRPF – PROFIT/INCOME TAX: 19% (for non-residents) on the profit between the purchase price plus the purchase price. Incidental acquisition costs and sales proceeds. The tax rate is slightly higher for residents – up to 28%. If the seller is a non-resident, the buyer must withhold 3% of the purchase price and pay this withholding to the tax office on behalf of the seller within 30 days.
3. Broker: If a broker is involved in the sale, the broker’s commission depends on the brokerage agreement signed.
4. Tax office/gestoria: It is advisable to involve a Gestoria or a tax office for the settlement of the tax debt through the sale. This is usually billed on a time and material basis.
5. Legal advice/lawyer: If a lawyer is involved in the sale of the property and takes care of the contractual matters, a fee of up to 1% of the sales price may be payable.
6. Other costs: There may be other costs incurred by the seller during the sale. These include, for example, the removal of mortgages or land charges at the land registry, check fees when paying in checks received, the energy certificate to be issued, etc.

To ensure a successful sale transaction of your property in Mallorca, it is crucial to consider the costs involved in advance and to have a realistic idea of the expenses. It is therefore advisable to inform yourself thoroughly and seek professional support in order to avoid unexpected costs and ensure a smooth sales process.